Reinventing Online Marketplaces in the Cloud

By Jeffrey M. Kaplan
May 5, 2017 9:54 AM PT

One of the cornerstones of a successful software business has been to build as big a partner ecosystem as possible. In the world of the cloud, showcasing the partner ecosystem in an online marketplace also has become an imperative.

Salesforce has been in the vanguard of this trend. Since its inception in 2005, the AppExchange has grown to include more than 3,000 partner solutions that augment Salesforce's growing portfolio of cloud services. AppExchange has strengthened significantly Salesforce's position in the marketplace by cataloging the company's rapidly expanding ecosystem of independent software vendor and consulting partners.

However, the tremendous success of the AppExchange has made it a bit overwhelming for customers to find and easily implement the right third-party solutions to best meet their needs.

Special Incentives

Salesforce this week
unveiled a new AppExchange Partner Program that will replace its current ISV Partner Program. The new AppExchange Partner Program includes a series of new offerings, incentive programs and grading systems. Taken together, they could redefine how the company's customers utilize the AppExchange to meet their needs, and how Salesforce's partners leverage the AppExchange to enhance their go-to-market capabilities.

The new AppExchange approach aims to drive Salesforce's partners and customers to take fuller advantage of the company's platform capabilities and Trailhead training programs.

The new AppExchange Partner Program specifically incentivizes partners to incorporate Salesforce DX and Heroku into their cloud solutions. Salesforce also hopes partners will incorporate its Einstein artificial intelligence and machine learning capabilities into their offerings.

However, just building new solutions on the company's platform isn't enough to get its full attention and support in the increasingly competitive partner ecosystem. Given the escalating challenges facing customers that want to adopt a widening array of cloud services available on the AppExchange, Salesforce wants its partners to incorporate a new set of onboarding tools and techniques to ensure their success.

Partnership Game Changer

The new Salesforce Onboarding Experience includes a wide assortment of automated guides, checklists and payment tools, and it will open up API support for the company's Channel Order App so partners can simplify their order submission process.

Salesforce wants to be sure the proper training programs are in place to ease the onboarding process. The AppExchange Partner Program includes a new Trailblazer Score for the partner certification and promotion equation. The point-based system grades partners on customer success; on product success, based on security review status and adoption of new Salesforce technology; and on team readiness, based on Trailhead courses completed. It even takes into consideration partner participation in the
Pledge 1% giving back program.

Salesforce is offering financial incentives to encourage its existing partners to adopt the new offerings and to attract new partners to its ecosystem. It is lowering the baseline percent-net-revenue (PNR) model for all new AppExchange Partner Program partners from 25 percent to 15 percent to attract new partners. Existing partners can take advantage of the new PNR terms when they renew their current contracts.

Salesforce Ventures has launched a new US$100 million Salesforce Platform Fund that will invest in startups and other companies that are building solutions on the Salesforce platform.

If the new initiatives are successful, the new AppExchange Partner Program will change the rules for building a vibrant online partner ecosystem, as well as change the way customers evaluate and select cloud marketplace partners.

Jeff Kaplan has been an ECT News Network columnist since 2009. His focus is on cloud computing, SaaS, IT management, managed services and the Internet of Things. He is managing director of
THINKstrategies.
Email Jeff.